25._The_Elephants_Revised_F09 - 25: The Elephants Discovery...

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1 25: The Elephants Discovery of Huge Reserves, Entry of More Players, & Emergence of OPEC
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2 Oil: Growth Industry, 1950-60s A large oil field is known as an elephant. Oil boomed from 8.7 million barrels per day (mmbd) in 1948 to 42 mmbd in 1972. Oil production in the Middle East grew from 1.1 million barrels per day to 18.2 million barrels per day…a 1,500 percent increase! Reserves increased from 62 billion barrels in 1948 to 534 billion barrels in 1972
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3 What are Elephants?
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4 World Oil Fields
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5 Middle East & Russian Oil
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6 Twin Pillars of Postwar Oil Order 1. Oil deals of the 1940s Tied reserve development into refining and marketing networks of big oil companies At the heart was the 50-50 principle, stability Countries, like Iran, explored ways to increase their revenues International consortium a major block Turned to an Italian…
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7 Man with a mission The Italian Rockefeller, Enrico Mattei A born leader, partisan during WWII Act first, get permission later Appt. head of ENI, drilled for oil; hit natural gas Built ENI into a major integrated oil company in Italy Wanted to gain access to crude oil for ENI and Italy
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8 More on Mattei Coined the term, “Sette Sorrelle,” or “Seven Sisters” – the Anglo-Saxon Club Exxon, Mobil, Chevron, Texaco, Gulf Eighth sister, CFP (French) Mattie was excluded from Iranian consortium Started talking with the Shah after Suez Struck a 25-75 deal(1957), didn’t find much oil but “the 50-50 deal was about as dead as the 4 minute mile. And as inevitably”
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This note was uploaded on 04/19/2011 for the course EGEE 120 taught by Professor Considine,timothy during the Spring '07 term at Pennsylvania State University, University Park.

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25._The_Elephants_Revised_F09 - 25: The Elephants Discovery...

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